Substantial property transactions—Granada Group Limited v The Law Debenture Pension Trust Corporation Plc

Substantial property transactions—Granada Group Limited v The Law Debenture Pension Trust Corporation Plc

In this case the Court of Appeal considered the legality of the pensions arrangement for former directors of a company, in particular, whether the directors’ membership of a secured unfunded unapproved occupational pension scheme amounted to the acquisition of a non-cash asset for the purposes of section 320 Companies Act 1985 (CA 1985) (whose successor is now to be found in section 190 of the Companies Act 2006 (CA 2006)). The case raises some interesting issues regarding how definitions of 'non-cash asset', 'interest' and 'connected person' can be construed for the purposes of CA 1985, s 320.

Introduction and facts

Granada Group Limited v The Law Debenture Pension Trust Corporation Plc [2016] EWCA Civ 1289

The appeal concerned the legality of pension arrangements for former directors of Granada Group Ltd (Granada). In the High Court, Andrews J held that the arrangements were lawful. Her judgment is at [2015] EWHC 1499 (Ch), [2015] Bus LR 1119. With the permission of Arden LJ, Granada appealed the decision.

In this case the Court of Appeal considered the legality of the pensions arrangement for former directors of a company, in particular, whether the directors’ membership of a secured unfunded unapproved occupational pension scheme amounted to the acquisition of a non-cash asset for the purposes of CA 1985, s 320 (whose successor is now to be found in CA 2006, s 190). The case raises some interesting issues regarding how definitions of 'non-cash asset', 'interest' and 'connected person' can be construed for the purposes of CA 1985, s 320.

What was the background to the case?

Granada had anoccupational pension scheme for all its employees, (the Granada Pension Scheme) which was approved by HMRC so as to qualify for tax relief on contributions, investments and benefits. However, the Finance Act 1989 introduced anearnings cap limiting the total amount of pensionable earnings which could be taken into account in calculating the

Subscription Form

Already a subscriber? Login
RELX (UK) Limited, trading as LexisNexis, and our LexisNexis Legal & Professional group companies will contact you to confirm your email address. You can manage your communication preferences via our Preference Centre. You can learn more about how we handle your personal data and your rights by reviewing our  Privacy Policy.

Related Articles:
Latest Articles:

Access this article and thousands of others like it free by subscribing to our blog.

Read full article

Already a subscriber? Login

About the author: